The influence of technology on the future of human resource management PDF

Preview

Summary

Human Resource Management Review 25 (2015) 216–231 Contents lists available at ScienceDirect Human Resource Management Review journal homepage: www.elsevier.com/locate/humres The influence of technology on the future of human resource management Dianna L. Stone a,⁎, Diana L. Deadrick b,1, Kimberly M....

Description

Human Resource Management Review 25 (2015) 216–231

Contents lists available at ScienceDirect

Human Resource Management Review journal homepage: www.elsevier.com/locate/humres

The influence of technology on the future of human resource management Dianna L. Stone a,⁎, Diana L. Deadrick b,1, Kimberly M. Lukaszewski c,2, Richard Johnson d,3 a Departments of Management, University at Albany, State University of New York, and Virginia Polytechnic Institute and State University address is: c/o 866 Fawnway San Antonio, TX 78260 210-497-4965 b Old Dominion University, Strome College of Business, Department of Management, 2138 Constant Hall, Norfolk, VA 23529, United States c Department of Management and International Business, Wright State University, 3640 Colonel Glenn Highway, Dayton, OH 45435, United States d Department of Management, University at Albany, State University of New York, 1400 Washington Avenue, Albany, NY 12222, United States

a r t i c l e

i n f o

Keywords: Human resource management Technology HRIS eHRM e-recruiting e-selection e-learning e-compensation

a b s t r a c t In recent years, information technology has had a profound effect on human resources (HR) processes and practices. However, relatively little research has examined its effectiveness, and most of the existing studies have not assessed the degree to which these new systems enable organizations to reach their HR goals of attracting, motivating and retaining employees. One reason for this is that there are a number of limitations associated with current systems including the fact that they: (a) use one way communication systems, (b) are impersonal and passive, (c) do not always allow for interpersonal interaction, and (d) often create an artificial distance between individuals and organizations. Thus, the primary purposes of the present article are to review the current effects of technology on HR processes, consider the existing literature on the topic, and discuss the advantages and potential limitations of using these systems. In addition, we offer directions for future research and practice on using technology to facilitate HR processes. © 2015 Elsevier Inc. All rights reserved.

Information technology has had widespread effects on almost every aspect of our society. From the invention of the telegraph to the creation of smartphones, it has changed the way we live our lives and do our jobs. For example, technology has altered the way we purchase products, communicate with others, receive health care services, manage our finances, and educate our students. It has also had a profound impact on organizational processes, including those in Human Resource Management (HR) (Gueutal & Stone, 2005; Kavanagh, Thite, & Johnson, 2015; Parry & Tyson, 2011; Strohmeier, 2007), and transformed the way that organizations recruit, select, motivate, and retain employees. Interestingly, a survey of leading consulting firms indicated that "…there are two primary drivers of change in HR: technology and talent management. …Continuous innovations in technology will fundamentally change the way HR work is accomplished." (Society for Human Resource Management [SHRM], 2002, p. ii). In this context, we define information technology (hereinafter referred to as technology) as the application of computers and telecommunication devices to collect, store, retrieve, and disseminate data for business purposes (http://en.wikipedia.org/wiki/Information_technology retrieved June 18, 2014). Despite the pervasive impact of technology on HR in organizations, there has been relatively little research that examines its effectiveness (Gueutal & Stone, 2005; Olivas-Lujan, Ramirez, & Zapata-Cantu, 2007; Parry & Tyson, 2011; Ruël, Bondarouk, & Looise, 2004). Thus, we believe that additional research is needed to assess the degree to which technology and electronic human resource manage⁎ Corresponding author. Tel.: +1 210 497 4965. E-mail addresses: [email protected] (D.L. Stone), [email protected], [email protected] (D.L. Deadrick), [email protected] (K.M. Lukaszewski), [email protected] (R. Johnson). 1 Tel.: +1 757 83 4224. 2 Tel.: +1 845 750 5950. 3 Tel.: +1 518 956 8371.

http://dx.doi.org/10.1016/j.hrmr.2015.01.002 1053-4822/© 2015 Elsevier Inc. All rights reserved.

D.L. Stone et al. / Human Resource Management Review 25 (2015) 216–231

217

ment (eHRM) enable organizations to achieve their HR goals (Parry & Tyson, 2011; Stone, Stone-Romero, & Lukaszewski, 2003). e-HRM is defined as a system that allows managers, applicants, and employees access to human resource related information and services through the Internet or an organization's intranet or web portal (Lengnick-Hall & Moritz, 2003). Given the rapid changes in technology in the past decades, we believe that it will influence the nature of HR processes in the future. Thus, the primary purposes of this paper are to (a) review the current effects of technology on HR processes, (b) consider the existing literature on the topic, (c) discuss the advantages and limitations of these new systems, (d) suggest how it may affect the future of HR, and (e) offer directions for future research and practice. 1. How has technology affected HR processes? The principal goals of HR in organizations are to attract, select, motivate, and retain talented employees in their roles (Katz & Kahn, 1978). These goals have become extremely important in recent years because organizations compete on the basis of the skills and talents of their workers (Huselid, 1995). Technology has transformed the way HR processes are currently managed, mainly in terms of how organizations collect, store, use, and disseminate information about applicants and employees. In addition, it has altered the nature of jobs, job relationships, and supervision. Innovations such as telework, virtual teams, and web-based job applications are due to commensurate innovations in technology. Apart from the impact of technology on HR processes, Kiesler and her colleagues argued that IT now mediates the relationship between individuals and organizations, and subordinates and supervisors (Kiesler, Siegel, & McGuire, 1984). It has also reduced the influence of distance in organizations so that employees can work from home or interact with team members across geographical boundaries. Furthermore, it has enabled organizations to hire individuals with specialized skills in remote parts of the world (e.g., software developers) (Aguinis, Henle, & Beaty, 2001; Aguinis & Lawal, 2013). Therefore, in the paragraphs below, we provide an overview of some of applications of technology and eHRM in organizations. We also provide a brief review of the research on the topic, but note that our review is not exhaustive. 2. Goal 1: Attracting a talented and diverse workforce One of the primary goals of HR is to attract and retain a talented workforce (Katz & Kahn, 1978). The first step is thus recruiting a qualified, diverse, and motivated applicant pool. Effective recruitment can not only enhance the skills and diversity of the workforce, but can also help build customer satisfaction, foster innovation, and encourage creativity (Cox, 1993). Over time, various forms of technology have been introduced to attract applicants, ranging from passive, one-way technologies (e.g., web-based job ads, job boards) to more interactive techniques (such as virtual job fairs). Some estimates indicate that approximately 90% of large organizations use one or more forms of technology to advertise jobs and enable applicants to submit online applications (e.g., Mackelden, 2013). The following paragraphs focus on the use of technology for recruitment, and this process has been labeled as electronic recruiting (e-recruiting). 3. Research on e-recruiting One of the key questions surrounding e-recruiting is "Does information technology enable organizations to increase the number of successful placements made?" Although researchers have begun to analyze e-recruitment factors that affect applicant attraction to organizations (e.g., types of applicants attracted to the organization, website attributes, customization of information provided), little or no research has assessed the effects of e-recruitment on the success of job placements or retention rates (see Dineen & Allen, 2013; Dineen & Soltis, 2011; Stone, Lukaszewski, & Isenhour, 2005; Stone et al., 2003). Perhaps the most essential question regarding the efficacy of e-recruiting is "Does it attract talented and diverse applicants who can perform successfully in organizations?" Although few studies have addressed this question, those results indicated that e-recruiting attracts greater numbers of applicants, but not higher quality applicants as compared with traditional recruiting technologies (Chapman & Webster, 2003; Galanaki, 2002). Furthermore, the increased volume of applicants increases administrative and transaction costs (Stone et al., 2005). Even though one study did find that e-recruiting attracted applicants with higher levels of drive, achievement, and persistence than traditional recruiting, that same study found that e-recruiting also appealed to job hoppers with unfavorable backgrounds (McManus & Ferguson, 2003). In terms of diversity, research thus far suggested that e-recruiting may not help organizations increase workforce diversity (e.g., Kuhn & Skuterud, 2000; McManus & Ferguson, 2003; Zusman & Landis, 2002). For instance, some studies found that older applicants, ethnic minorities, and women were less likely to use e-recruiting than Anglo-Americans (e.g., Kuhn & Skuterud, 2000; McManus & Ferguson, 2003), thus limiting the degree to which organizations meet their diversity goals (see Stone et al., 2003; Stone, Lukaszewski, Stone-Romero, & Johnson, 2013 for a more thorough discussion). One reason for this is that some ethnic minorities (e.g., African-Americans, Hispanic Americans) still have less Internet access at home, and others (e.g., older individuals and women) often have higher computer anxiety and lower computer-self-efficacy than their counterparts (Johnson, Stone, & Navas, 2011; Pew Internet & American Life Project, 2010; Wallace & Clariana, 2005). Notably, the differences between traditional and e-recruiting may be less problematic as younger, more technology-oriented applicants enter the workforce. In contrast to the studies that focused on applicant characteristics, other research on e-recruiting has focused on characteristics of the technology such as website attributes and the use of customization as a means of influencing applicant satisfaction and attraction to the organization (Dineen & Allen, 2013; Dineen & Soltis, 2011). These results suggested that although the ease of use of the website and its perceived quality were positively related to applicants' attraction to the organization (Scheu, Ryan, & Nona, 1999; Zusman & Landis, 2002), the attractiveness of the website was not related to applicants' motivation to apply for jobs (Cober, Brown, Levy,

218

D.L. Stone et al. / Human Resource Management Review 25 (2015) 216–231

Keeping, & Cober, 2003). Other research examined the relative effects of objective (e.g., job attributes), subjective (brand image, fit), and critical factors (e.g., website medium) on applicants' attraction to organizations (Allen, Mahto, & Otondo, 2007). Those findings revealed that organizational image and media richness were positively related to website credibility and attitudes toward the organization (Allen et al., 2007; Badger, Kaminsky, & Behrend, 2014; Lyons & Marler, 2011). Media richness refers to the social, visual, and aural cues inherent in interpersonal communication including non-verbal behaviors, eye contact, and head nodding, (Daft & Lengel, 1986). Still other studies assessed the impact of customization, or personalization, of e-recruiting information on applicants' attraction to organizations, and found that it (a) encouraged applicants to apply for jobs, (b) persuaded poor-fitting job seekers to eliminate themselves from the applicant pool, and (c) influenced well-fitting applicants to apply for jobs (see Cable & Turban, 2001; Dineen & Allen, 2013; Dineen & Noe, 2009). 4. Limitations of e-recruiting and directions for the future To date, the research findings on e-recruitment are somewhat mixed, but some evidence suggests that it may increase the efficiency and lower the costs of the recruiting process (Cappelli, 2001). However, studies do not clearly indicate if it helps organizations enhance the goals of attracting a large pool of talented and diverse job applicants (Allen et al., 2007; Chapman & Webster, 2003; Galanaki, 2002; McManus & Ferguson, 2003). One reason for this may be that the current technologies use static, or one-way communication processes that merely provide information to applicants about job openings and enable them apply for jobs online (e.g., websites, job boards). These technologies do not give applicants the opportunity to ask questions or interact with organizational members. As a result, applicants do not have the opportunity to communicate with actual organizational members or clarify the nature of jobs or the benefits of working for the organization. Thus, we believe that current e-recruiting practices may be extremely impersonal, passive, and create an artificial distance between applicants and organizations. In contrast to one-way technology, some new interactive technologies may enhance the personalization of e-recruiting, and increase its overall effectiveness (e.g., Web 2.0, social media, virtual reality, blogs, virtual job previews) (see Dineen & Allen, 2013; Sullivan, 2014). For instance, in the future Web 2.0 users will be able to attend virtual job fairs, develop interactive dialogues with organizational members, and experience a virtual preview of life in the organization. A virtual job fair is an online event where employers and potential applicants connect in a virtual environment using computer-based simulations, chat rooms, webinars, and webcasts to browse company booths, upload resumes, and meet with employers (http://en.wikipedia.org/wiki/Virtual_reality retrieved June 13, 2014). Some organizations are already using Second Life Virtual Environments to conduct job fairs (T-Mobile, eBay, Verizon, U.S. Army) (Kaplan & Haenlein, 2009). Second Life Virtual Environments allow multiple users to access simulated worlds, and take the form of avatars that are visible to others. The users are also presented with perceptual stimuli, allowed to manipulate elements in the simulated world, and experience a degree of telepresence (http://secondlife.com/whatis/ retrieved June 14, 2014). The trend toward use of more interactive technologies for e-recruiting is a positive step toward enhancing the organization's image as a warm and welcoming place to work, and ensuring that e-recruiting meets its intended goals. Research findings regarding traditional recruiting highlight the effectiveness of techniques in terms of interpersonal style of recruiters and their perceived credibility (Rynes, 1991) both of which are possible with interactive technology. Likewise, studies found that some minorities (e.g., Hispanic-Americans, women) are very relationship-oriented and prefer interacting with individuals rather than information technology (Johnson et al., 2011). In this way, the two-way communication processes available with interactive e-recruiting should help attract a more diverse pool of applicants. Overall, the use of interactive technologies should have a positive impact on applicants' motivation to apply for jobs and their subsequent satisfaction levels. In a related vein, another limitation of e-recruiting technology has been that it is a passive process in which organizations use technology; i.e., post information and wait for applicants to apply for jobs. In the future, e-recruiting may become much more proactive and use social media (e.g., Linkedin) to scan individual profiles, identify talented employees, and contact them about job openings. In this way, organizations can use technology to reach out to qualified and diverse job applicants, and motivate them to apply for jobs. Moreover, this proactive strategy should be especially effective in terms of enhancing the diversity of the applicant pool. One reason for this is that some minorities (e.g., Hispanic-Americans, older individuals, women) may have reward preferences that are different from the dominate group in our society (e.g., Bell, Marquardt, & Berry, 2014; Guerrero & Posthuma, 2014; Hertel, van der Heijden, de Cange, & Deller, 2013; Stone, Johnson, Stone-Romero, & Hartman, 2006). Therefore, data from social media or crowdsourcing can be used to identify the reward preferences of diverse applicants, and recruitment strategies can be tailored to meet their needs (see Stone et al., 2006; Sullivan, 2014). Crowdsourcing refers to the process of proactively obtaining ideas, information, or needed services by soliciting information or contributions from large groups of people online rather than in traditional face-toface settings (http://www.merriam-webster.com/dictionary/crowdsourcing retrieved June 13, 2014). 5. Goal 2: Selecting talented and diverse employees A second goal of HR is to select the most talented applicants from among those who apply for the job, and ensure that they represent the diversity of applicants in the labor pool (Guion, 1965). In recent years technology has had a major impact on this process, with some reports indicating that 74% of large U.S. organizations now use electronic selection to facilitate the hiring process (CedarCrestone, 2010). The term e-selection is used here to refer to various forms of technology to assess the degree to which applicants' knowedge, skills, and abilities (KSAs) fit with the job requirements (e.g., web-based job applications, tests, and interviews; see Stone et al., 2013).

D.L. Stone et al. / Human Resource Management Review 25 (2015) 216–231

219

A key question is "Does the use of e-selection help organizations hire the most talented and diverse applicants?" There has been some research on e-selection, but we know of no research that has examined this overall question. Instead, some studies have examined the effectiveness and acceptance of e-selection in terms of each of the following four steps: job analysis, job applications, tests, and interviews. A brief review of that research follows. 5.1. Electronic job analysis Electronic job analysis (EJA) allows subject matter experts in different geographic locations to provide data about job duties and worker requirements, and then work together in a virtual team to come to an agreement about these job and behavioral requirements (Reiter-Palmon, Brown, Sandall, Buboltz, & Nimps, 2006). Initial findings from this research indicated that EJA methods resulted in more comprehensive descriptions of jobs, and shorter completion times compared with traditional job analysis methods (ReiterPalmon et al., 2006). 5.2. Electronic job applications Organizations are also using web-based application systems that require applicants to apply for jobs online, and use keyword screening systems to determine whether applicants are qualified for the job. There has been considerable research on web-based applications, and studies examined the effects of website characteristics on applicants' attraction to organizations (see section on e-recruiting) (e.g., Allen et al., 2007; Cober et al., 2003; Dineen & Allen, 2013; Lyons & Marler, 2011; Zusman & Landis, 2002). Other studies assessed the legality of the content of these applications (Wallace, Tye, & Vodanovich, 2000), administrative use of these systems (Mohamed, Orife, & Wibowo, 2002), and individual factors that affect use rates (McManus & Ferguson, 2003; Pew Internet & American Life Project, 2010; Stone et al., 2003). For instance, Wallace et al. (2000) found that 97.5% of online applications contained at least one illegal or non-job-related question. In addition, a study on administrative factors found that the criteria used for keywords were not always based on job-analysis (Mohamed et al., 2002). Furthermore, results of a study by McManus and Ferg...